In germany it's a game. You try to get someone to look into the hole you form with your hand (he need to look at it by himself, you are not allowed to put it infront of the face) .. If you get someone to do that, you can give him a punch. Its a childish game i saw mostly in my schooltime but yeah.. Thats the background for that.

Personally, I think that all people who do this are, ehe, stupid. Honestly, I don't want to walk around school on constant alert that someone's going to do it to me, because in my country, you get to punch the person who looked in the shoulder and then wipe it off.
EDIT: In America, it also has to be below the waist.